The Santiago Corporation provides an executive stock option plan granted options on January 1, 2012, that permit executives to a par value common shares price is the market price of the shares on the date of the options, estimated by an appropriate option pricing m cquire 70 million of the company's $1 within the next eight years, but not before December 31, 2015. The exercise odel, is $4 per option. grant, $27 per share. The fair value of the Required (show your calculations for full credit): 1. Prepare the appropriate journal entry to record compensation expense on December 31, 2012. Based on 2. Suppose during 2013 it is determined that 15% of the options had been forfeited. ation, prepare the appropriate journal entry to record the compensation expense on December 31, 2013. Suppose on January 15, 2016, 25% of the remaining options granted were exercised when the market price of the stock was $30 per share. Prepare the journal entry to record the exercise of the options. Provide two (2) benefits and two (2) drawbacks of issuing equity-based compensation. 4. Explain the impact that stock options have on a company's EPS calculation. 5